SeeThruEquity Issues Update on PotNetwork Holding, Inc. (OTC: POTN)
November 30 2017 - 8:44AM
InvestorsHub NewsWire
New York, NY -- November 30,
2017 -- InvestorsHub NewsWire -- SeeThruEquity, a leading
independent equity research and corporate access firm focused on
small-cap and micro-cap public companies, today announced it has
issued an update on PotNetwork Holding, Inc.
The report is available
here: POTN
November Update Note.
PotNetwork Holding (OTC: POTN), through its subsidiary
Diamond CBD Inc., focuses on research, development, and sale of
premium hemp extracts that contain a broad range of cannabinoids
and natural hemp derivatives. CBD is one of the more than 85
cannabinoids identified in marijuana and hemp plants and is
non-psychoactive with wide array of therapeutic benefits. Hemp
derived CBDs provides a legal alternative to marijuana based CBD
(which is banned at federal level) and allows the consumer to enjoy
CBD without the risk of getting high and breaking any federal laws.
Hemp derived CBD market is projected to grow at a CAGR of ~53% till
2020, positioning it as the fastest growing sub segment within the
multi-billion-dollar legal cannabis and hemp market. Diamond CBD
continues to report robust top line growth, as indicated by recent
3Q17 sales and continued momentum in October. We see POTN as
a speculative growth company focused on the burgeoning legal
cannabis and hemp market targeting the fastest growing sub segment
(hemp derived CBD). Upcoming catalysts new product launches,
aggressive marketing initiatives and entry into new markets
(specifically China).
Highlights from the update
include:
We are increasing our price target
for POTN following encouraging results since our initiation of
coverage. POTN results have included robust top line growth,
as well as a reduction in shares outstanding. The company now
appears to be tracking ahead of our initial results, with
significant sales momentum in a structural growth
market.
Highlights of recent developments
at POTN include:
- On
November 2, 2017, POTN pre-announced positive 3Q17 sales results
with revenue of approximately $4.4mn, up 29% sequentially from
$3.2mn in 2Q17.
- Momentum appears to have continued for the
company as management announced October sales came in at $1.7mn, up
40%+ from September.
- On
November 27, 2017, POTN retired 300mn common shares held by
principal shareholders, reducing common shares outstanding; the
shares will be exchanged for non-trading preferred
shares.
- The
company appointed a new PCAOB accounting firm registered in South
Florida, East West Accounting Services, LLC, to deliver a detailed
review and audit of recent revenues results.
- In
October, POTN appointed Dr. Richard Goulding, MD, as its new
CEO. According to the announcement, Dr. Goulding will bring
the company key insights on the medical benefits of cannabidiol
(CBD) from a physician’s standpoint, including insights on research
for CBD as a treatment for pain management and other medical
applications as the company expands its presence in the
market. Former CEO Gary Blum will remain with POTN as
Chairman of the Board of Directors.
Increasing price target to
$0.40
We are increasing our target to
$0.40 following recent results and apparent sales momentum at the
company as it expands its product offerings and distribution. The
$0.40 target suggests a valuation of 4.7x 2018E revenues of 22.8mn
and 40x estimated 2018E EPS of $0.01.
Please review important disclosures
on our website at www.seethruequity.com.
About PotNetwork Holding,
Inc.
PotNetwork Holding Inc. is a
publicly traded company that acts as a holding company for its
subsidiary, First Capital Venture Co., the owner of Diamond CBD,
Inc. Diamond CBD focuses on the research, development, and
multi-national marketing of premium hemp extracts that contain a
broad range of cannabinoids and natural hemp derivatives. For more
information, visit www.diamondcbd.com.
About
SeeThruEquity
Since its founding in 2011,
SeeThruEquity has been committed to its core mission:
providing impactful, high quality research on underfollowed
smallcap and microcap equities. SeeThruEquity has pioneered
an innovative business model for equity research that is not paid
for and is unbiased. SeeThruEquity is the host of acclaimed
investor conferences that are the ultimate event for publicly
traded companies with market capitalizations less than $1
billion.
SeeThruEquity is approved to
contribute its research reports and estimates to Thomson One
Analytics (First Call), the leading estimates platform on Wall
Street, as well as Capital IQ and FactSet. SeeThruEquity
maintains one of the industry’s most extensive databases of opt-in
institutional and high net worth investors. The firm is
headquartered in Midtown Manhattan in New York City.
For more information visit
www.seethruequity.com.
For more information visit
www.seethruequity.com.
Contact:
Ajay Tandon
SeeThruEquity
info@seethruequity.com
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